Most Federal Reserve officials see it appropriate to raise interest rate soon if economy continues to improve, minutes of the Fed's latest monetary policy meeting showed Wednesday.
"Most participants judged that if economic information came in about in line with their expectations, it would soon be appropriate for the (Federal Open Market) Committee to take another step in removing some policy accommodation," said the minutes.
At its latest policy meeting on May 2 and 3, the Fed left its benchmark interest rates unchanged as the central bank waited on more data to assess the U.S. economic outlook.
Although Fed officials believed that the recent slowdown in economic growth was transitory, they hold that it would be prudent to await additional evidence before raising interest rate, according to the minutes.
They hold that the weak consumption spending at the beginning of this year was also transitory and expected that the consumption growth would pick up pace in the coming months, in view of the solid fundamentals, such as solid job gains, rising household income and wealth, improved household balance sheets, and buoyant consumer sentiment.
During the meeting, Fed officials also discussed plans to reduce the central bank's 4.5-trillion-U.S. dollar balance sheet.
According to the minutes, nearly all policymakers favored a plan to increase caps or limits on the amount of Treasury and agency securities that would be allowed to run off each month. They indicated that it would be appropriate to begin reducing the central bank's securities holdings this year, if the economy evolves as expected.
Market analysts said Wednesday's minutes indicated that the Fed might be ready to raise interest rate in its June meeting.
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